ISLAMABAD, PAKISTAN
— After more than a year of battling Al Qaeda guerrillas and their tribal supporters along the Afghan border, Pakistan is trying a new tactic: buying loyalty.

The government has paid more than $800,000 total to four tribal commanders as part of a November peace deal, a senior army official revealed last week. The four men led a bloody fight against Pakistani forces hunting foreign Al Qaeda fighters in South Waziristan, a mountainous tribal region believed to be a possible hideout for Osama bin Laden.

The sizable sums were given so that tribesmen could pay back loans from Al Qaeda. Hundreds of foreign fighters have been relying on local militants for shelter, supplies, and protection - and have paid them handsomely for it. During negotiations with the government, the commanders explained they needed help repaying financial debts to the terror group. In Pashtun culture, failure to repay loans represents a dangerous loss of face within the tribe.

The deal's success so far suggests that the loyalty to Al Qaeda among Pashtun tribesmen is based as much on rupees as on radicalism. If so, efforts at bringing development to tribal areas as well as crackdowns on the sources of Al Qaeda's funding could prove to be two potent weapons in the war on terror, analysts say.

"The battle was tagged by mullahs and militants as a jihad to gain [local] support and sympathies, but actually it revolved around economics and financial gains from foreign terrorists," says Asmatullah Gandapur, a top official in South Waziristan.

Intelligence sources say that Al Qaeda lured tribal militants with huge sums of money, and registers were maintained for recording salaries for local fighters.

"The fighters used to get a 15,000 rupee [around $250] monthly salary. The commanders used to get advances running into millions for arms and ammunition, communication, and Land Cruisers," says a local intelligence official.

A $16 bag of sugar

Tribesmen benefited by renting out their compounds for shelter and training camps, and providing food to foreign militants. "A chicken worth 60 rupees [a dollar] would be sold to Al Qaeda for 900 rupees [$15] and a bag of sugar worth 950 rupees [$16] would be provided for 9,000 rupees [around $150]," says tribesman Mohammad Noor. [Editor's note: The original version miscalculated the cost of sugar in US dollars.]

Similarly, a compound, which is usually rented out for $17 to $25, would be given to Al Qaeda as a training camp or hideout for around $10,000.

Most of Al Qaeda's money was transferred from Arab countries through hawala, a parallel banking system that exists on the black market.

Some locals even witnessed Al Qaeda operatives roaming around South Waziristan with bags full of dollars.

"Once I visited my cousin in a remote village where everybody was talking about a rich bearded Arab distributing money among villagers. Later I came to know he was a big financier," says tribesman Farid Khan, referring to Saad bin Khadr, who was killed in a military operation in October 2003.

South Waziristan has been center stage for the war on terror after hundreds of Al Qaeda militants, including Arabs, Uzbeks, Chechens, and Tajiks, found it a haven following the Taliban's ouster. Initially, it was estimated that around 600 Al Qaeda fighters were in hiding. Now officials say that figure has dropped to 100 to 150, though tribal sources say it's in the hundreds.

Pakistan has used a combination of force, economic sanctions, and negotiation to compel tribesmen to deny refuge to the foreign fighters. More than 500 people have been killed in the fighting in South Waziristan.

In return for amnesty, the four commanders pledged to stop fighting security forces, withdraw support for Al Qaeda, and refrain from attacking the US-led forces across the border. The men walked away with a bagful of money after they insisted that they owed money to Al Qaeda given to them to fight against the security forces, say official sources.

"At the start of the negotiations they asked for 170 million rupees [$2.8 million] but later they reduced the figure to 50 million rupees [$842,000]," Lt. Gen. Safdar Hussain, head of military operations in the tribal region, told reporers last week.

Traditionally the authorities used to award construction contracts to tribal leaders as a bribe to maintain peace in the tribal belt, but this is the first time the money was paid to tribal militant commanders fighting for Al Qaeda.

"Now giving money to militants seems to be an attempt to buy loyalty," says Mr. Noor. "It is also benefiting authorities by bringing disrepute to the militants. The tribesmen are cursing the militants that they fought for greed and not for jihad."

Commander denies deal

Apparently feeling the heat, the militant commanders are now denying the deal. "We neither made such a demand, nor were we paid 50 million rupees. We have been only paid some amount to rebuild homes demolished during the military operations. We did not owe any money to Al Qaeda people," says Haji Omer, a senior militant commander.

Mr. Omer's denial carries echoes of Naik Mohammed, another tribal commander who struck a deal with Pakistani officials last year, only to reneg. He was later killed in fighting.

Bait Ullah Mehsud, who is believed to be head of operations for the Taliban in South Waziristan, struck a peace deal with the authorities last week. He, however, refused to take offers of money.

The test of whether these latest peace deals stick, analysts say, will come next month when the snow starts to melt, allowing for cross-border attacks to resume against US-led forces.

Sailab Mehsud, an expert in South Waziristan, doubts that money will be enough to sever tribal support for Al Qaeda.

"Al Qaeda's network cannot be eliminated while Osama [bin Laden] and [his deputy] Zawahiri are alive. Their ability to hide gives moral support to the fighters who consider it a defeat of the superpower, America," says Sailab Mehsud, expert on South Waziristan. He likens the peace deals to cutting down plants, but leaving seeds behind. "The seeds of support, in the shape of extremism in the minds of many tribesmen, still exist."